Released: September 10, 2007

SEC critical of senior investment pitches

Source: Marcy Gordon, Associated Press (Free Registration)

An investigation by federal and state regulators of “free lunch” investment seminars aimed at seniors has found high-pressure sales pitches masquerading as educational sessions, pervasive misleading claims for unsuitable financial products and even fraud.

Much of the blame goes to investment firms for failing to properly supervise their employees who put on the seminars for seniors, according to the report of the investigation being made public today. By law, the sales pitches made at the seminars and the materials provided to participants must be approved by a brokerage or investment firm’s supervisors.

The examination by the Securities and Exchange Commission, state regulators and the securities industry’s self-policing organization, the Financial Industry Regulatory Authority, covered seven states that have large numbers of retirees: Alabama, Arizona, California, Florida, North Carolina, South Carolina and Texas.

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